Sovereign wealth funds, private companies and new money from emerging market economies may be pushing pensions out of the frame for lucrative infrastructure investments.
Richard Guay, CIO, La Caisse de dépôt et placement du Québec, told Global Pensions: "Infrastructure was interesting for us as a long term investment, but we have missed most deals in the past 18 months through someone bidding higher.
"We no longer have the monopoly as some Asian central banks and countries with revenues from oil have taken the competitive advantage."
With the ongoing liquidity crisis and investment banks less willing to lend and help make these deals possible, pension funds have found themselves no longer able to call the shots.
Investors without the liabilities faced by a pension fund, and who therefore have less constraints on their asset allocation, have realised there is money to be made in this area.
On Monday, a consortium lead by Ontario Teachers' Pension Plan (OTPP) and the Canadian Pension Plan Investment Board (CPPIB) were thwarted in an attempt to take a 75 year lease of a turnpike in the US.
The Pennsylvania Turnpike contract was won by a consortium lead by a private Spanish company. At US$12.1bn, the pension funds' proposal had made the final three, having been within the required 10% of the highest bid. The winning group finally bid $12.8bn.
Bob Bertram, executive vice president, investments, OTPP, commented on the deal: "It would have made an excellent investment for a pension fund, but initially the expected real returns were higher than they are now [by matching the winning bid], so the level of competition has already bid the real return down quite dramatically."
Peter Muldowney, worldwide partner at Mercer in Toronto, explained: "Pension plans have very precise expectations of returns whereas other investors do not have such constraints.
"For some time large pension plans had the advantage over smaller funds, but now they are feeling the pressure of competition," he added.
The advent of collective pension systems could help the UK avoid demographic challenges which will make it "impossible" for society to help savers in retirement, experts say.
More than half of people over the age of 55 see financial security as a top priority in retirement, yet a third allocate more time to buying a new car, finds Legal & General (L&G) research.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).